With the ups and downs of the stock market, rental properties are becoming increasingly popular among investors. They’re a fantastic way to generate cash flow right away even as the property appreciates in value over time. Unless you have the time and money to remodel a place right away, turnkey real estate properties are the way to go.
Finding the Best Turnkey Real Estate Investment Properties
What is a Turnkey Property?
For passive income generation, turnkey properties can’t be beat. Turnkey real estate properties are ready to go the day you purchase them. While reality TV shows present a glamorous view of buying and and flipping houses, purchasing a rental property that needs work can lead to unnecessary problems.
When an investor purchases a property that needs remodeling, they need to put even more resources into updating the property before they can begin to show it to potential renters. Unexpected issues often arise with properties that are older or in disrepair, causing the project to cost more and drag on longer than originally expected. In addition to requiring the cash to have the work done, this delays their ability to put their property to work for them.
A turnkey property, however, needs no updating or remodeling. As soon as the deal closes, an investor can literally “turn the key” and rent it right out. Some turnkey properties may even come with active tenants already in place. If they do, this is a real plus, as it’s passive income that’s all ready to go!
Crunching the Numbers
Once you’ve decided that you’re interested in turnkey real estate investment properties, the next step is to look at the numbers. First, it’s important to set a clear budget. As you shop for properties, make sure you stick to your budget in order to stay in a range that’s affordable. The purpose of a turnkey investment property is to make passive income --- not to create financial problems down the road. By purchasing within your means now, you’ll avoid problems later.
The next step is to research various neighborhoods in the area in which you’d like to invest. What areas are the most attractive to renters? What’s the typical rate for rent in those places? Does investing in that area make sense for you?
Work with a Turnkey Investment Company
The key (no pun intended) to finding the best turnkey real estate properties is to work with an investment company that specializes in this specific area. Do your research to determine that a specific turnkey investment company is the right fit for you. For instance, make sure they’re familiar with the area in which you’d like to invest. This is especially true if you’re purchasing property in another state; it’s important to have someone experienced to guide you through the ins and outs of an unfamiliar real estate/rental market.
Also be aware if a turnkey investment company only sells properties, but doesn’t have a property management arm that enables it to continue taking care of their clients after the sale. Some of these companies engage in fly-by-night practices in which they sell a property that has hidden problems that are only unearthed after the fact.
A reputable turnkey investment company will be open and honest about everything. They’ll disclose all of the details about a property and allow the owner to be as involved as they’d like to be. They’ll be happy to provide references from current or previous investors they’ve worked with. Most of all, they will confidently demonstrate that they’re knowledgeable and experienced in assisting their clients. When searching out turnkey real estate properties, an excellent turnkey investment company will be your most valuable tool.
Smartland is Northeast Ohio's largest turnkey real estate investment firm. Our team combines financial savvy with expertise in property management to help clients identify and invest in alternative investment vehicles that have strong growth potential.